An irrevocable trust is one of the most important tools you have to protect your estate and reduce your taxable income during your lifetime. These trusts allow you to separate specific assets from your estate permanently.
There are limitations and some restrictions on when these trusts are beneficial. By working with an Arlington Heights irrevocable trust attorney from Plan Forward Legal, you will know if this type of trust can offer advantages to your estate plan. Our founder, Victoria Lozano, is a trusted Arlington Heights estate planning attorney who is by your side through the entire process.
How an Irrevocable Trust Works
A trust is a component of a comprehensive estate plan. It allows you to make specific decisions about what happens to assets after your death. However, unlike a revocable living trust, you cannot make changes to an irrevocable trust once it is in place. For that reason, you need to consider this trust carefully and when it is the best move for you.
In an irrevocable trust, you can still move assets into the trust and hold them there until your death. The trust can continue for as long as necessary to distribute funds to the named beneficiaries in accordance with the specific rules you set up. Your trust administrator will continue to follow the initial directions presented to achieve this.
Once the assets are in the irrevocable trust, the trust owns them. You can no longer make changes to what you enter or to who receives them. However, by moving assets into a trust like this during your lifetime, you can reduce your taxable income and may shield those assets from liability claims made against you.
Consider the Benefits of an Irrevocable Trust
By working with an irrevocable trust attorney in Arlington Heights, we can review how this type of trust fits your situation. For most people, the reasons to use these trusts include the following:
- They provide you with privacy. Unlike a simple will, trusts do not go through probate. That means what you include in the trust is not part of the public record. No one not mentioned in the trust has access to that information.
- Your creditors cannot touch your trust. An irrevocable trust provides the highest level of protection for assets from creditor claims. Assets you fund into the trust legally belong to the trust, not to you or your beneficiaries. A lawsuit filed against you cannot touch these assets.
- They lower your estate taxes. When you move assets into the trust, the trust maintains ownership of them. That means the funds here are separate from your taxable estate. That also means that they are not subject to federal estate taxes.
- You choose how the funds disperse. With the help of our Arlington Heights irrevocable trust lawyer, we can create a trust that outlines the specific mandates you want, including when and under what conditions the beneficiaries can access the funds.
Setting up an irrevocable trust can help you position your assets to pass to your beneficiaries while providing the highest level of protection. Yet, these are complex legal tools. Before you use them or try to set one up, be sure to work with a skilled irrevocable trust lawyer in Arlington Heights at Plan Forward Legal to review the benefits and risks.
The Limitations of Using an Irrevocable Trust
Setting up an irrevocable trust can offer benefits, but it may also have disadvantages in some situations. When you speak to our Arlington Heights irrevocable trusts attorney, we will explore each of these areas with you carefully.
- You no longer have control. Once the assets are transferred to the trusts, they are no longer under your control. The trust is a legal entity, and you can no longer make decisions about those assets. Instead, the trustee, whom you appoint to oversee the trust, will need to follow the mandates you set in dispersing the funds within the trust.
- These are complex legal documents. To make sure your wishes are clear, work with an attorney. Setting up an irrevocable trust on your own is not recommended. The terminology and details in the trust must be very clear and precise. They must also follow all Illinois trust laws (760 ILCS 3/ Illinois Trust Code). Failure to do so can create risks.
Setting up a trust can still be a valuable step. It does not have to be the only type of trust you use or the only component of your estate plan.
Why Choose an Irrevocable Trust Attorney Near Me
By working with an attorney to establish your trust, you minimize some of the most significant concerns. We help you to:
- Avoid critical omissions that could alter the legal rights of the trust
- Ensuring you choose the most appropriate trustee for the job
- Build trust in a way that preserves your wishes best, utilizing the law as our tool to do so
- Work alongside your tax accountant to build a trust structure that moves assets at the right time to reduce taxes during and after your life
- Offer answers and guidance to you on your legal limitations once a trust is in place
Having an Irrevocable trust attorney protects you. Notably, not all estate planning attorneys recommend the use of these trusts, and the average family lawyer may not have enough insight into how to structure them to safeguard your future and wishes. For that reason, always seek out a seasoned estate planning attorney.
How to Get Started with an Irrevocable Trust Lawyer Near Me
You do not have to decide whether an irrevocable trust is the ideal choice for your estate plan just yet. Instead, meet with our Arlington Heights irrevocable trusts attorney to discuss your concerns, including liability risks, financial decision-making, and your goals for your estate after your death. We will provide you with a strategy that fits your unique situation.
Work with an Arlington Heights irrevocable trusts lawyer to gain clarity and to explore the limitations of these trusts. We also work with those who may already have such a trust or another component of an estate plan, who need help with modifications or updates. Call Plan Forward Legal today.